Economic growth in developing countries


Economic growth is the most important means of raising people’s incomes and reducing poverty in the developing world – it creates jobs and opportunities for poor people to support their families and build more stable futures.

Many developing countries face particular challenges that make it difficult for them to stimulate and sustain economic growth. These challenges include weak institutions, high unemployment, poor infrastructure, a lack of access to financial services and unsuitable laws and regulations.

Millions of people do not own or have formal rights to the land they live and work on. This makes it difficult to plan or save for the future. The risk of losing land and property can deter people from investing, for example in irrigation for their land. It can also make it difficult for people to borrow to fund investments.

We are aiming to provide opportunities for more than 500 million people in developing countries to lift themselves out of poverty by 2015. We aim to:

  • help more than 50 million people to access savings, credit and insurance – including 18 million women
  • help half the countries in Africa benefit from freer trade
  • secure the right to land and property for more than 6 million people – including 4.5 million women


We work with governments, investors and business in developing countries to strengthen their business environment, increase their access to international markets, improve their infrastructure and give more people access to financial services.

Helping developing countries to remove barriers to trade and investment

We help developing countries to create the right conditions for growth and investment by working with their governments to create suitable economic policies, good governance and openness to trade and investment.

Helping developing countries to improve their infrastructure

We work with developing countries to improve their transport, energy and water services and supplies.

Helping people in developing countries access financial services

We work to give poor people better access to savings, credit and insurance, including support to 18 million women to access financial services like bank accounts, savings and insurance.

Stimulating private sector investment in developing countries

We work with the CDC (the UK’s bilateral development finance institution) to stimulate responsible and long-term private investment in developing countries.

Enabling businesses to include poor people directly

We work with developing countries to create new approaches to business that generates profits with a strong developmental impact. We work with British and European businesses, providing them with the skills and knowledge to invest profitably in developing countries and deliver development benefits to the poor.

Supporting fair and ethical business operations

We encourage and incentivise responsible business practices which enable businesses to make a more positive impact through their operations in developing countries.

We will do this by supporting:

Helping developing countries benefit from global and regional trade

We work to help developing countries benefit from global and regional trade by reducing trade costs and time, opening up global market opportunities, improving working conditions and helping countries create and sustain trading links with other economic communities.

Research evidence on promoting sustainable economic development in developing countries

We generate high quality evidence on private sector and economic growth in poor countries. We work with poor countries to help them use the evidence to find effective ways to stimulate economic growth.

Providing debt relief for developing countries

We work with international organisations to provide debt relief for developing countries.

Helping developing countries to improve their provision of basic services

We work to improve private sector provision of basic services for the poorest by helping developing country governments and the private sector providers of education, health, water and sanitation.


The government’s white paper, ‘Trade and Investment for Growth’ explained DFID’s efforts to open global market opportunities to developing countries.

In a recent speech, Secretary of State Justine Greening outlined the importance of investing in economic growth in developing countries, how DFID works in new and emerging markets and the role of business in international development. The new measures announced included:

  • a Tax Capability Unit within HMRC to provide an in-house team of tax experts dedicated to working with DFID teams in developing countries where there is a high prospect of developing their tax base
  • a Commercial Law and Justice Programme that will help to identify and remove legal constraints that add to the costs and risks of doing business in partner countries and encourage reform
  • a £51 million investment in DFID’s International Growth Centre to expand its work to Burma, Malawi, Liberia and Nigeria - the International Growth Centre provides expert, independent growth policy advice direct to governments in developing countries
  • a joint work programme with the Confederation of British Industry, industry bodies and non-governmental organisations to identify barriers to working in developing countries and how the UK government can help to remove them

In 2011 DFID published ‘The Engine of Development: The private sector and prosperity for poor people’ which set out how we intended to involve the private sector more fully in reducing poverty in developing countries.

The Debt Relief (Developing Countries) Act 2010

The Debt Relief (Developing Countries) legislation means that creditors can no longer use UK Courts of Law to pursue excessive claims against highly indebted poor countries on their historic debts.